Fix condition in web metrics server and client filters

micrometer-core/src/main/java/io/micronaut/configuration/metrics/binder/web/WebMetricsClientCondition.java

@@ -25,13 +25,20 @@
 public class WebMetricsClientCondition implements Condition {
     @Override
     public boolean matches(ConditionContext context) {
-        boolean isClassPresent = ClassUtils.isPresent("io.micronaut.micrometer.observation.http.client.ObservationClientFilter", context.getBeanContext().getClassLoader());
+        boolean observationPresent = ClassUtils.isPresent(
+            "io.micronaut.micrometer.observation.http.client.ObservationClientFilter",
+            context.getBeanContext().getClassLoader()
+        );
 
-        if (!context.containsProperty("micrometer.observation.http.client.enabled") && isClassPresent) {
-            return false;
+        if (!observationPresent) {
+            return true;
         }
 
-        return !context.containsProperty("micrometer.observation.client.server.enabled") || !context.getProperty("micrometer.observation.http.client.enabled", Boolean.class).orElse(false);
+        boolean observationEnabled = context
+            .getProperty("micrometer.observation.http.client.enabled", Boolean.class)
+            .orElse(Boolean.TRUE);
+
+        return !observationEnabled;
     }
 
 }

micrometer-core/src/main/java/io/micronaut/configuration/metrics/binder/web/WebMetricsServerCondition.java

@@ -25,12 +25,19 @@
 public class WebMetricsServerCondition implements Condition {
     @Override
     public boolean matches(ConditionContext context) {
-        boolean isClassPresent = ClassUtils.isPresent("io.micronaut.micrometer.observation.http.server.ObservationServerFilter", context.getBeanContext().getClassLoader());
+        boolean observationPresent = ClassUtils.isPresent(
+            "io.micronaut.micrometer.observation.http.server.ObservationServerFilter",
+            context.getBeanContext().getClassLoader()
+        );
 
-        if (!context.containsProperty("micrometer.observation.http.server.enabled") && isClassPresent) {
-            return false;
+        if (!observationPresent) {
+            return true;
         }
 
-        return !context.containsProperty("micrometer.observation.server.server.enabled") || !context.getProperty("micrometer.observation.http.server.enabled", Boolean.class).orElse(false);
+        boolean observationEnabled = context
+            .getProperty("micrometer.observation.http.server.enabled", Boolean.class)
+            .orElse(Boolean.TRUE);
+
+        return !observationEnabled;
     }
 }

micrometer-observation-http/src/test/groovy/io/micronaut/micrometer/observation/FilterCreationSpec.groovy

@@ -1,6 +1,7 @@
 package io.micronaut.micrometer.observation
 
 import io.micrometer.core.instrument.MeterRegistry
+import io.micrometer.observation.ObservationRegistry
 import io.micronaut.configuration.metrics.binder.web.ClientMetricsFilter
 import io.micronaut.configuration.metrics.binder.web.ServerMetricsFilter
 import io.micronaut.micrometer.observation.http.client.ObservationClientFilter
@@ -70,4 +71,38 @@ class FilterCreationSpec extends Specification{
         context.getBeansOfType(ServerMetricsFilter).size() == 0
     }
 
+    void 'check condition both server filters enabled'() {
+        when:
+        def context = io.micronaut.context.ApplicationContext.builder(
+                'micronaut.application.name': 'test-app',
+                'micronaut.metrics.binders.web.enabled': 'true',
+                'micrometer.observation.http.server.enabled': 'true'
+        ).start()
+
+        then:
+        context.getBeansOfType(MeterRegistry).size() == 1
+        context.getBeansOfType(ObservationRegistry).size() == 1
+        context.getBeansOfType(ObservationClientFilter).size() == 1
+        context.getBeansOfType(ObservationServerFilter).size() == 1
+        context.getBeansOfType(ClientMetricsFilter).size() == 0
+        context.getBeansOfType(ServerMetricsFilter).size() == 0
+    }
+
+    void 'check condition both client filters enabled'() {
+        when:
+        def context = io.micronaut.context.ApplicationContext.builder(
+                'micronaut.application.name': 'test-app',
+                'micronaut.metrics.binders.web.enabled': 'true',
+                'micrometer.observation.http.client.enabled': 'true'
+        ).start()
+
+        then:
+        context.getBeansOfType(MeterRegistry).size() == 1
+        context.getBeansOfType(ObservationRegistry).size() == 1
+        context.getBeansOfType(ObservationClientFilter).size() == 1
+        context.getBeansOfType(ObservationServerFilter).size() == 1
+        context.getBeansOfType(ClientMetricsFilter).size() == 0
+        context.getBeansOfType(ServerMetricsFilter).size() == 0
+    }
+
 }

micrometer-observation/build.gradle

@@ -10,6 +10,8 @@ dependencies {
 
     implementation mn.reactor
     implementation mn.micronaut.core.reactive
+    implementation mn.micronaut.context
+
     compileOnly(libs.managed.micrometer.tracing)
 
     testAnnotationProcessor mn.micronaut.inject.java

micrometer-observation/src/main/java/io/micronaut/micrometer/observation/DefaultObservedFactory.java

@@ -24,6 +24,9 @@
 import io.micrometer.observation.ObservationHandler;
 import io.micrometer.observation.ObservationPredicate;
 import io.micrometer.observation.ObservationRegistry;
+import io.micrometer.observation.Observations;
+import io.micronaut.runtime.event.annotation.EventListener;
+import io.micronaut.context.event.ShutdownEvent;
 import io.micrometer.tracing.Tracer;
 import io.micrometer.tracing.handler.TracingAwareMeterObservationHandler;
 import io.micrometer.tracing.handler.TracingObservationHandler;
@@ -85,6 +88,7 @@ ObservationRegistry observationRegistry(
         observationPredicates.forEach(observationRegistry.observationConfig()::observationPredicate);
         observationFilters.forEach(observationRegistry.observationConfig()::observationFilter);
         observationConventions.forEach(observationRegistry.observationConfig()::observationConvention);
+        Observations.setRegistry(observationRegistry);
         return observationRegistry;
     }
 
@@ -159,4 +163,9 @@ ObservationHandlerGroupingClass observationHandlerGroupingClassMeterTracer() {
         return new ObservationHandlerGroupingClass(TracingObservationHandler.class);
     }
 
+    @EventListener
+    void onShutdown(ShutdownEvent shutdown) {
+        Observations.resetRegistry();
+    }
+
 }

micrometer-observation/src/test/groovy/io/micronaut/micrometer/observation/DefaultObservedFactorySpec.groovy

@@ -4,11 +4,13 @@ import io.micrometer.core.instrument.MeterRegistry
 import io.micrometer.observation.ObservationFilter
 import io.micrometer.observation.ObservationHandler
 import io.micrometer.observation.ObservationRegistry
+import io.micrometer.observation.Observations
 import io.micrometer.tracing.Tracer
 import io.micrometer.tracing.handler.DefaultTracingObservationHandler
 import io.micrometer.tracing.handler.PropagatingReceiverTracingObservationHandler
 import io.micrometer.tracing.handler.PropagatingSenderTracingObservationHandler
 import io.micrometer.tracing.propagation.Propagator
+import io.micronaut.context.ApplicationContext
 import spock.lang.Specification
 
 class DefaultObservedFactorySpec extends Specification {
@@ -20,7 +22,7 @@ class DefaultObservedFactorySpec extends Specification {
 
     void 'test no metrics and no trace'() {
         when:
-        def context = io.micronaut.context.ApplicationContext.builder(
+        def context = ApplicationContext.builder(
                 'micronaut.application.name': 'test-app',
         ).start()
 
@@ -35,9 +37,31 @@ class DefaultObservedFactorySpec extends Specification {
         context.getBeansOfType(ObservationRegistry).size() == 1
     }
 
+    void 'observations global registry is set on startup and reset on shutdown'() {
+        given:
+        Observations.resetRegistry()
+        def initialConfig = Observations.getGlobalRegistry().observationConfig()
+
+        when:
+        def context = ApplicationContext.builder(
+                'micronaut.application.name': 'test-app',
+        ).start()
+
+        then:
+        def registryBean = context.getBean(ObservationRegistry)
+        Observations.getGlobalRegistry().observationConfig().is(registryBean.observationConfig())
+
+        when:
+        context.close()
+
+        then:
+        Observations.getGlobalRegistry().observationConfig().is(initialConfig)
+    }
+
+
     void 'test metrics and no trace'() {
         when:
-        def context = io.micronaut.context.ApplicationContext.builder(
+        def context = ApplicationContext.builder(
                 'micronaut.application.name': 'test-app',
         ).start()
         context.registerSingleton(meterRegistryMocked)
@@ -56,7 +80,7 @@ class DefaultObservedFactorySpec extends Specification {
 
     void 'test trace and no metrics'() {
         when:
-        def context = io.micronaut.context.ApplicationContext.builder(
+        def context = ApplicationContext.builder(
                 'micronaut.application.name': 'test-app',
         ).start()
         context.registerSingleton(tracerMocked)
@@ -95,7 +119,7 @@ class DefaultObservedFactorySpec extends Specification {
 
     void 'test metrics and trace with propagator'() {
         when:
-        def context = io.micronaut.context.ApplicationContext.builder(
+        def context = ApplicationContext.builder(
                 'micronaut.application.name': 'test-app',
         ).start()
         context.registerSingleton(meterRegistryMocked)

src/main/docs/guide/observation.adoc

@@ -29,3 +29,31 @@ You can configure the behavior of this module by modifying the following propert
 
 - To disable HTTP server instrumentation, set the `micrometer.observation.http.server.enabled` property to `false` (the default value is `true`).
 - To disable HTTP client instrumentation, set the `micrometer.observation.http.client.enabled` property to `false` (the default value is `true`).
+
+==== HTTP server metrics filter selection and fallback
+
+When the Observation HTTP module is present on the classpath, the HTTP server is instrumented by the Observation-based filter by default, and the Micrometer-based server metrics filter (ServerMetricsFilter) is not created. When the module is absent, the Micrometer-based server metrics filter is created to ensure HTTP metrics are still recorded.
+
+ServerMetricsFilter instruments Micrometer metrics via MeterRegistry, whereas ObservationServerFilter uses ObservationRegistry and can emit metrics and traces depending on configuration.
+
+- Observation module present (default):
+  - `micrometer.observation.http.server.enabled` absent or `true` → ObservationServerFilter active; Micrometer-based ServerMetricsFilter not created.
+  - `micrometer.observation.http.server.enabled=false` → Observation disabled; Micrometer-based ServerMetricsFilter created (subject to general metrics enablement).
+- Observation module absent:
+  - Any value of `micrometer.observation.http.server.enabled` → Micrometer-based ServerMetricsFilter created.
+
+This behavior prevents a “no metrics” situation if the observation feature is enabled in configuration but the Observation HTTP module is not on the classpath. The observation property only affects behavior when the Observation HTTP module is available.
+
+==== HTTP client metrics filter selection and fallback
+
+When the Observation HTTP module is present on the classpath, the HTTP client is instrumented by the Observation-based filter by default, and the Micrometer-based client metrics filter (ClientMetricsFilter) is not created. When the module is absent, the Micrometer-based client metrics filter is created to ensure HTTP client metrics are still recorded.
+
+ClientMetricsFilter instruments Micrometer metrics via MeterRegistry, whereas ObservationClientFilter uses ObservationRegistry and can emit metrics and traces depending on configuration.
+
+- Observation module present (default):
+  - `micrometer.observation.http.client.enabled` absent or `true` → ObservationClientFilter active; Micrometer-based ClientMetricsFilter not created.
+  - `micrometer.observation.http.client.enabled=false` → Observation disabled; Micrometer-based ClientMetricsFilter created (subject to general metrics enablement).
+- Observation module absent:
+  - Any value of `micrometer.observation.http.client.enabled` → Micrometer-based ClientMetricsFilter created.
+
+This mirrors the server-side selection and avoids a “no metrics” situation when the Observation HTTP module is missing.